How Soon Can You Get A Mortgage After a Short-Sale?

By
Mortgage and Lending with Mortgages Unlimited, Inc NMLS 274132

How Soon Can You Get A Mortgage After a Short-Sale?

Depending on which lending institution you ask you will receive different time-frames allowed to purchase again after a short sale or foreclosure. The reason is most lenders have credit overlays, which translates into stricter underwriting guidelines than Fannie Mae and FHA have published. There are lesser time-frames allowed if there are documented Extenuating Circumstances involved beyond the control of the borrower, such as serious illness or death of a wage earner, and the borrower has re-established good credit since the foreclosure. 

Divorce, loss of employment, inability to sell the property and job transfer or relocation does not qualify for extenuating circumstances. All other events are known as Financial Mismanagement.

  • Conventional - Foreclosure - 7 years
  • FHA - Foreclosure: 3 years.  Exception: No waiting Period if the borrower was current on their mortgage and all other installment debt for the 12 months preceding the short sale, the new subject property is not in the same geographical area as the short sale, and the short sale lender accepted the short sale as payment in full.
  • USDA - 3 years
  • VA - 2 years
  • Conventional Short-sale 2-7 years: 2 years with 20% down, 4 years with 10% down (2 years with 10% with  extenuating Circumstance) and 7 years with less than 10% down or financial mismanagement.

I am using the current Fannie Mae conventional guidelines to close loans for Short Sale as of 6/20/2012.

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Our name says it all - In MN and WI, visit Mortgages Unlimited for all your home mortgage loan needs. Offices throughtout the metro area, Including St Paul, Minneapolis, and Maple Grove.

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Re-Blogged 1 time:

Re-Blogged By Re-Blogged At
  1. June Piper-Brandon 06/25/2012 08:20 AM
Topic:
Lending / Financial
Location:
Minnesota
Groups:
Mortgages
All About Mortgages/Mortgage Networking
The FHA Mortgage Group
Minnesota Real Estate
Investment Property (USA)
Tags:
minneapolis
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st paul
after
mortgage
short sale
shortsale
mortgages unlimited
how soon

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Rainmaker
960,917
June Piper-Brandon
Remax New Beginnings - Baltimore, MD
Piecing Dreams One Home at a Time

This is great information and very informative for folks facing short sales and being post short sale.  Thanks for putting it together.

Jun 25, 2012 08:16 AM #1
Rainmaker
1,673,819
Winston Heverly
Winston Realty, Inc. - Atlantis, FL
GRI, ABR, SFR, CDPE, CIAS, PA

This should be sent to everyone thinking about a mortgage in the future, just wondering how many will try to get their act together during this period.

Jun 25, 2012 08:18 AM #2
Rainer
216,875
John Manuwal
Keller Williams Northwest Montana - Kalispell, MT
Kalispell Montana Agent and Photographer

Hi Joeseph,

Good info to know. Looks like the government loans at the faster way to start over for most folks.

Thanks, John

Jun 25, 2012 08:27 AM #3
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Joseph Metzler

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